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Why is substance important?
Due to increased scrutiny from tax authorities, companies need to ensure they think carefully about substance when implementing their tax structures. Taxand Cyprus explains why this is so crucial for organisations.
Economic substance has become an extremely important issue. More and more countries are looking deeper into the "substance over form" doctrine. It is a rather dangerous exercise to try to codify what actions need to be taken by any company to enhance its substance and there are a number of important factors and considerations to take into account.
Careful planning is needed in order to determine the extent of enhancing the substance of a company as different approaches are needed for a trading structure, an IP or intra-group financing structure, or a holding structure.
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